Dear reader, on 21 July, the American president announced that generic medicines entering the United States will be subject to a 0 percent tariff for two years, beginning on the first of August, then 100 percent in August 2028, and 200 percent the year after. The stated purpose is to move generic manufacturing onto American soil, with what he called a penalty for companies that decline to build there. It arrived as a social media post and left the mechanics undefined: whether the duty falls on finished doses, on active ingredients, or on both.

On 2 April, an executive order under Section 232 of the 1962 Trade Expansion Act imposed a tariff of 100 percent on patented medicines and their active ingredients, effective 31 July for large companies and 29 September for smaller ones that depend on contract manufacturers, with a reduced rate of 15 percent for the European Union, Japan, Korea, and Switzerland. Generics, biosimilars, and their ingredients were carved out. This announcement delays that carve-out.

A generic is not a branded medicine with a smaller price tag. It is a different business obeying different physics, and that distinction is the whole story.

About 9 in 10 prescriptions filled in the United States are generic, yet they account for only a small fraction of what Americans spend on medicine. That is the system's achievement and its fragility. Competition has driven an ordinary generic tablet down to a few cents, and many hospital injectables sell for two dollars a vial or less. At that price, there is no margin in which to absorb a tariff, however gradually it arrives. A 100 percent duty on a branded drug selling for a thousand dollars a month opens a negotiation. The same duty on a two-dollar vial of chemotherapy is an exit decision.

That should worry a health minister more than a trade minister, and the evidence is already on the record. The United States had 227 medicines in active shortage as of the second quarter of this year, a third consecutive quarterly rise. Sterile injectables, the old antibiotics, anesthetics, and cancer drugs account for around 70% of the shortages today, and a quarter of those shortages began in 2021 or earlier. When cisplatin and carboplatin ran short, oncologists rationed standard treatment for months because one overseas plant had failed an inspection. These shortages are structural, and their cause is the very margin the tariff now proposes to tax.

The timetable deserves scrutiny too. Two years sounds generous, but it isn't. Building a plant, transferring the process, qualifying equipment, passing a pre-approval inspection, and requalifying every ingredient source takes three to five years on a good day. And the dependency runs deeper than the last step: China and India together hold about 40% of the active ingredient sites registered with the American regulator, and closer to 80% of the volume, and Indian producers themselves rely on China for around 70% of their intermediates. Onshoring the final stage, while the chemistry that feeds it stays put, creates the appearance of security rather than substance.

Let me be fair to the policy, because a real problem sits underneath it. Depending on a strategic rival for the antibiotics you would need in a crisis is a genuine vulnerability; the pandemic showed it plainly, and twenty years of market solutions did not fix it. But what hollowed out generic manufacturing was never trade policy. It was a purchasing system that rewards the lowest bid and nothing else, and a tariff does not touch it. Note also that the escalation falls in August 2028 and August 2029, the second of those after the current presidential term has ended. A rate announced three years out is leveraged as much as it is a schedule. More than a dozen large manufacturers have already traded pricing concessions for a three-year exemption from these tariffs, which tells you plainly what the instrument is for.

What does this mean for us? Three things, none involving sales to America.

Our own supply runs through the same two countries. If Indian and Chinese capacity is redirected toward the American market on new terms, or if manufacturers withdraw from thin products altogether, the Gulf earns no discount for standing aside. We inherit a thinner, dearer, more concentrated market, and in it we are a price taker.

The global generic supply chain is also being reordered for the first time in 30 years, and countries with both capacity and regulatory credibility will be part of that conversation. Our localization program has been argued on economic grounds, on jobs, value added, and import substitution. The stronger argument was always security of supply, and this is the moment to make it plain.

The third is quieter and larger. For decades, the price of a generic medicine was set by competition. It is now set by trade policy. Dear reader, that is a change of category rather than of degree, and every country that buys its medicines rather than making them should read the announcement in that light. The medicines that matter most are the ones with no margin left, and any policy aimed at them, ours included, has to begin by admitting it.